Question

In: Accounting

Record the following transactions for the month of August 2012 in the financial statements effects template...

Record the following transactions for the month of August 2012 in the financial statements effects template below and record the journal entries.

Part 1:

A) Purchased $4,000 in inventory on credit.

B and C) Sold inventory purchased in (A) for $7,000 in cash. (Note: requires 2 entries)

D) Received and paid electricity bill for $800 related to August

E) Received $12,000 in cash for inventory to be delivered in September 2012.

Balance Sheet

Income Statement

Transaction

Cash

+

Noncash
Assets

=

Liabilities

+

Contributed
Capital

+

Earned
Capital

Rev.

Exp.

=

Net

Asset

A)

B)

C)

D)

E)

Part 2: Record the journal entries for each transaction

Solutions

Expert Solution

Part-1 Balance Sheet Income Statement Amount $
Transaction Cash + Noncash = Liabilities + Contributed + Earned Rev. Exp. = Net Income
Assets Capital Capital
A) +      4,000 =             4,000 + + - =
B)    7,000 + = + + 7,000    7,000 - =         7,000
C) +    -4,000 = + + -4,000 -        4,000 =        -4,000
D)     -800 + = + +     -800 -          800 =           -800
E) 12,000 + =              12,000 + + - =
Part-2 S.No. Account Titles Debit $ Credit $
A.) Inventory      4,000
Accounts Payable     4,000
B.) Cash      7,000
Sales Revenue     7,000
C.) Cost of Goods Sold      4,000
Inventory     4,000
D.) Electricity Expense          800
Cash        800
E.) Cash    12,000
Unearned Revenue 12,000

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